EXHIBIT 99.1
April 13, 2006 - For immediate release
Contact: Scott Shockey, CFO (740) 446-2631
Ohio Valley Banc Corp Earnings up 10.8%
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GALLIPOLIS, Ohio - Ohio Valley Banc Corp [Nasdaq: OVBC] reported consolidated
net income for the quarter ended March 31, 2006, of $1,739,000 representing an
increase of 10.8 percent over the same period the prior year. Earnings per share
for the first quarter of 2006 were $.41, up 10.8 percent from the $.37 earned
the first quarter of 2005. Return on average assets and return on average equity
both improved to .94 percent and 11.93 percent for the first quarter of 2006,
versus .88 percent and 11.23 percent for the same time period the prior year. "I
wish to recognize the efforts of all the employees of Ohio Valley Banc Corp for
continuing to build on the solid accomplishments from 2005," stated Jeffrey E.
Smith, President and CEO. "They have emphasized revenue growth, strong expense
control and stable asset quality to produce another quarter of solid earnings
growth."
Net interest income, the Company's largest revenue source, increased due to
growth in earning assets in conjunction with an increase in the net interest
margin. For the first quarter of 2006, net interest income increased $508,000 or
7.4 percent from the prior year first quarter. With the increase in market
interest rates and emphasis on profitable loan pricing, the net interest margin
improved to 4.24 percent for the first quarter of 2006, as compared to 4.14
percent for the previous quarter and 4.12 percent for the first quarter of 2005.
The Company's average earning assets for the first quarter of 2006 were up 4.3
percent from the same period the prior year.
Based on the evaluation of the adequacy of the allowance for loan losses,
management provided $666,000 to the allowance for loan losses for the three
months ended March 31, 2006, an increase of $349,000 from the same time period
the prior year. The increase in provision for
loan losses was associated with the increase in net charge-offs and higher
relative loan balances. For the three months ending March 31, 2006, net
charge-offs were up $193,000 from the same three month period in 2005 primarily
due to a large recovery in commercial loans during the first quarter of 2005.
Management continues to be pleased with the stable nonperforming loan ratios.
The ratio of nonperforming loans to total loans was .40 percent at March 31,
2006, as compared to .41 percent at December 31, 2005 and March 31, 2005. The
ratio of nonperforming assets to total assets also remained steady at .59
percent at March 31, 2006, as compared to .62 percent at December 31, 2005 and
March 31, 2005. Management feels that the allowance for loan losses is adequate
to absorb probable losses in the portfolio. The allowance for loan losses was
1.16 percent of total loans at March 31, 2006, unchanged from December 31, 2005.
Noninterest income totaled $1,309,000 for the three months ended March 31, 2006
compared to $1,253,000 for the same time period last year, an increase of 4.5
percent. Contributing to the 2006 growth, was the increase in revenue from
additional investments in bank owned life insurance throughout 2005 which
generated additional income for the first quarter of 2006. Furthermore, income
growth continues to be enhanced by the increased volume of transactions
utilizing the Company's debit card. Interchange fees earned the first quarter of
2006 were up 17.0 percent from the first quarter of 2005. For the same time
period, monthly service charge fees decreased 6.7 percent due to the growth in
the number of service charge free checking accounts.
Noninterest expense totaled $5,607,000 for the first quarter of 2006, an
increase of $123,000 or only 2.2 percent as compared to $5,484,000 for the
previous year first quarter. Salaries and employee benefits, the Company's
largest noninterest expense, totaled $3,295,000 for the first quarter of 2006,
up 3.6 percent from the same time period the prior year. The
remaining noninterest expense categories were up collectively $10,000 from 2005.
The emphasis management placed on expense control contributed to an improvement
in efficiency. The efficiency ratio, which represents the cost to generate a
dollar in revenue, improved to 64.3 percent for the three months ending March
31, 2006, as compared to 67.3 percent for the three months ending March 31,
2005.
Total assets increased $6,739,000 from year end 2005 to reach $756,458,000 at
March 31, 2006. Driving asset growth for 2006 was loan growth of $8,841,000,
occurring primarily in commercial loans. Funding loan growth was deposit growth
of $17,717,000 from year end 2005. The increase in money market and NOW account
balances contributed to 2006's deposit growth and the excess growth in retail
deposits permitted the Company to reduce borrowed funds by $12,407,000 from
December 31, 2005.
Ohio Valley Banc Corp common stock is traded on the NASDAQ Stock Market under
the symbol OVBC. The holding company owns three subsidiaries: Ohio Valley Bank,
with 16 offices in Ohio and West Virginia; Loan Central, with five consumer
finance offices in Ohio, and Ohio Valley Financial Services, an insurance agency
based in Jackson, Ohio. Learn more about Ohio Valley Banc Corp at www.ovbc.com.
Forward-Looking Information
Certain statements contained in this earnings release which are not statements
of historical fact constitute forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Words such as "believes,"
"anticipates," "expects," "intends," "targeted" and similar expressions are
intended to identify forward-looking statements but are not the exclusive means
of identifying those statements. Forward-looking statements involve risks and
uncertainties. Actual results may differ materially from those predicted by the
forward-looking statements because of various factors and possible events,
including: (i) changes in political, economic or other factors such as inflation
rates, recessionary or expansive trends, and taxes; (ii) competitive pressures;
(iii) fluctuations in interest rates; (iv) the level of defaults and prepayment
on loans made by the Company; (v) unanticipated litigation, claims, or
assessments; (vi) fluctuations in the cost of obtaining funds to make loans; and
(vii) regulatory changes. Forward-looking statements speak only as of the date
on which they are made and Ohio Valley undertakes no obligation to update any
forward-looking statement to reflect events or circumstances after the date on
which the statement is made to reflect unanticipated events.
OHIO VALLEY BANC CORP - Financial Highlights (Unaudited)
Three months ended
March 31,
2006 2005
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PER SHARE DATA
Earnings per share $0.41 $0.37
Dividend per share $0.16 $0.15
Book value per share $14.04 $13.27
Dividend payout ratio 39.11% 41.52%
Weighted average shares
outstanding 4,248,551 4,288,574
PERFORMANCE RATIOS
Return on average equity 11.93% 11.23%
Return on average assets 0.94% 0.88%
Net interest margin 4.24% 4.12%
Efficiency ratio 64.26% 67.26%
Average earning assets
(in 000's) $708,869 $679,818
OHIO VALLEY BANC CORP - Consolidated Statements of Income (Unaudited)
Three months ended
(in $000's) March 31,
2006 2005
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Interest income:
Interest and fees on loans $11,748 $10,081
Interest and dividends on securities 884 871
Total interest income 12,632 10,952
Interest expense:
Deposits 3,914 2,858
Borrowings 1,373 1,257
Total interest expense 5,287 4,115
Net interest income 7,345 6,837
Provision for loan losses 666 317
Noninterest income:
Service charges on deposit accounts 658 705
Trust fees 53 53
Income from bank owned insurance 187 148
Gain on sale of loans 26 28
Other 385 319
Total noninterest income 1,309 1,253
Noninterest expense:
Salaries and employee benefits 3,295 3,182
Occupancy 334 334
Furniture and equipment 268 295
Data processing 217 164
Other 1,493 1,509
Total noninterest expense 5,607 5,484
Income before income taxes 2,381 2,289
Income taxes 642 719
NET INCOME $1,739 $1,570
OHIO VALLEY BANC CORP - Consolidated Balance Sheets (Unaudited)
(in $000's, except
share and per share data) March 31, December 31,
2006 2005
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ASSETS
Cash and noninterest-bearing deposits
with banks $ 17,572 $ 18,516
Federal funds sold --- 1,100
Total cash and cash equivalents 17,572 19,616
Interest-bearing deposits in other financial
institutions 515 510
Securities available-for-sale 65,315 66,328
Securities held-to-maturity
(estimated fair value: 2006 - $12,310,
2005 - $12,373) 12,056 12,088
FHLB stock 5,778 5,697
Total loans 626,373 617,532
Less: Allowance for loan losses (7,273) (7,133)
Net loans 619,100 610,399
Premises and equipment, net 8,451 8,299
Accrued income receivable 2,977 2,819
Goodwill 1,267 1,267
Bank owned life insurance 16,117 15,962
Other assets 7,310 6,734
Total assets $ 756,458 $ 749,719
LIABILITIES
Noninterest-bearing deposits $ 78,763 $ 82,561
Interest-bearing deposits 501,820 480,305
Total deposits 580,583 562,866
Securities sold under agreements to
repurchase 16,181 29,070
Other borrowed funds 76,655 76,173
Subordinated debentures 13,500 13,500
Accrued liabilities 10,002 8,839
Total liabilities 696,921 690,448
SHAREHOLDERS' EQUITY
Common stock ($1.00 stated value, 10,000,000
shares authorized; 2006 - 4,626,337 shares
issued, 2005 - 4,626,336 shares issued) 4,626 4,626
Additional paid-in capital 32,282 32,282
Retained earnings 32,902 31,843
Accumulated other comprehensive income (1,437) (1,231)
Treasury stock at cost (2006 - 384,691 shares,
2005 - 361,365 shares) (8,836) (8,249)
Total shareholders' equity 59,537 59,271
Total liabilities and
shareholders' equity $ 756,458 $ 749,719